If you thought Mayor de Blasio’s inept governance of our city couldn’t get any worse in his administration’s waning days, think again.
A consortium of businesses working with the New York Yankees handed the city a $1 billion development plan for a blighted South Bronx neighborhood, and the geniuses in City Hall have all but killed it.
The culprit: parking spaces. That’s right. Parking spaces.
Of course, the utter idiocy of the people who run the city is seen every day on our increasingly crime-ridden streets, in out-of-control homelessness, and the general decay of civil society here in the Big Apple. Less visible is the incompetence of the city’s bureaucrats who deal with the business community.
It goes without saying that without entrepreneurs and bankers, real-estate moguls and restaurateurs, New York City wouldn’t be the great metropolis it is. So when business leaders provide City Hall with a win-win — housing and jobs for poor people, the redevelopment of one of the poorest neighborhoods in the country, on top of taxable income, it’s imperative that we have people in government who jump at these types of opportunities.
We don’t, sadly, which is why the demise of this plan, eight years in the making, is such a painful, albeit necessary story to tell.
It’s also a case study about why the end of the de Blasio administration can’t come fast enough.
The story begins in 2006 with the groundbreaking on the new Yankee Stadium in the South Bronx. The Bloomberg administration agreed to provide the team a little more than 9,000 parking spaces for fans, and keep several lots that are in walking distance of the stadium in “first class” condition.
Over time, Yankee fans increasingly took public transportation to the game, either subway or Metro North, because it’s an easy commute, but also because the city-approved agency running the lots, the Bronx Parking Development Corp., does such a lousy job at upkeep. “First class” soon fell to second, third and now a lot worse for a chunk of the area, Yankees officials tell me.
Today, some of the spaces are cluttered with trash and have attracted vermin. They’re used to park taxis, which wasn’t an intended use, and team executives believe they’re also possibly used as a chop shop. Parking revenue is almost nonexistent and more than $200 million in municipal bonds that financed the lots’ construction are in default.
Yankees President Randy Levine, a former deputy mayor in the Giuliani administration, thought he had the solution.
The Yankees are part-owner of a professional soccer team, New York City FC, which needed its own stadium. Levine needed community buy-in to approve the plan to build the soccer stadium on land adjacent to the ballpark, which was occupied by those crummy garages.
He put together a package that appeared to satisfy everyone. In exchange for approval for the soccer stadium, he agreed to build a new school, affordable housing and other facilities on land occupied by some of the garages. He did it with private money. Thousands of jobs in the South Bronx would be created.
The bondholders, an important constituency since they technically control the parking facilities in default, get a $50 million lifeline. The city, another important constituency because it’s owed back taxes on the defaulted lots, would start to recoup some of its losses as well.
The only hitch involved that parking stuff I mentioned before. The Yankees wanted a real guarantee of first-class parking of around 5,000 parking spaces (down from its initial deal for 9,000-plus) on the remaining lots.
Seems like a reasonable ask, right? The city and the bondholders actually agreed to the spaces in a term sheet signed by both parties last year.
But as the project was nearing a final community-board approval in recent weeks, something weird happened: The city got cold feet over the guarantee for those annoying first-class parking spaces.
So did bondholders, led by the investment firm Nuveen, who thought it was somehow odd that the Yankees would put together a multilayered plan that paid them $50 million and ask for something in exchange.
The city broke the news to Levine about two weeks ago that, despite earlier assurances, there will be no parking-space guarantees, flushing a $1 billion project down the crapper.
It’s just one of the many development projects that have been derailed by a de Blasio administration that is either inept or anti-business. From the rejected Amazon headquarters in Queens on down, how many chances to revitalize New York have we missed?
City officials say it was Levine who blew the deal up by asking for a “legal” guarantee for parking that they couldn’t agree on because they might someday get sued if they didn’t live up to their end of the bargain. They say the deal isn’t totally dead and could be revived through some sort of compromise. Levine says he’s “perplexed” by the city’s response since the bonds to build those lots were issued to guarantee Yankees fan parking in the first place.
Let’s hope something is worked out, because consider what the city walked away from: A $1 billion project, and thousands of jobs in one of its poorest areas, all over a few “guaranteed” parking spaces.